The Great Room opens first heritage shophouse location at Eu Yan Sang Building
By Timothy Tay and Atiqah Mokhtar
/ EdgeProp Singapore |
SINGAPORE (EDGEPROP) - Premium co-working operator The Great Room has opened a new location along South Bridge Road in the Chinatown district. Spanning four floors and 22,000 sq ft, it occupies the former Eu Yan Sang Building — a row of four conservation shophouses that date to 1910. The historic property, located at 265 to 271 South Bridge Road, was built by the traditional Chinese medicine brand Eu Yan Sang as a medicine hall and was its first outlet in Singapore.
In December 2019, the shophouses were sold to property investment and development group 8M Real Estate for $54 million. The group purchased the original three-storey shophouses from Eu Realty (Singapore), an Eu Yan Sang International subsidiary, on a 199-year lease. After undertaking addition and alteration works, 8M Real Estate brought The Great Room on board to manage and operate the entire property as The Great Room, South Bridge.
The space marks the hospitality-focused co-working operator’s sixth location in Singapore and the first one it manages in a conservation shophouse. Jaelle Ang, co-founder and CEO of The Great Room, recalls that the decision to partner with 8M Real Estate on the project came together quickly. Ang says: “When I spoke with Ashish [Manchharam, founder and CEO of 8M Real Estate], we could both see it happening. We have a lot of values in common.”
This is not the first time The Great Room has undertaken a property with a rich conservation heritage. In July 2019, it opened its workspace at Raffles Arcade, the retail space of the iconic Raffles Hotel Singapore. Coincidentally, the designer of the Raffles Hotel, British architect Alfred Bidwell of Swan & Maclaren, also designed the Eu Yan Sang Building.
Given the shophouse property’s historic significance, The Great Room and 8M Real Estate sought views from various stakeholders on the project, including URA, the Building and Construction Authority (BCA), and Richard Eu, a member of the Eu family and the current chairman of Eu Yan Sang International. “We wanted to present a great workspace that is very contemporary yet respectful of the property’s heritage, conservation status, and location in Chinatown,” says Ang.
The fourth floor houses a restaurant and bar that can double up as an event venue (Picture: Samuel Isaac Chua/The Edge Singapore)
A new lease of life
When 8M Real Estate took over the property in January 2020, it embarked on restoration works to bring the exterior of the building back to its original glory. At the same, wherever possible, it focused on enhancing internal floor efficiency, including shifting the position of some staircases and creating a rooftop space. A new cooling system was installed along with other sustainable features which contributed towards the property earning a Green Mark Platinum rating, the BCA’s highest accolade for a building’s sustainability.
The property was handed over to The Great Room in 4Q2022, with the operator tasked to fit out and deliver the final product. The Great Room approached the space with the goal of minimising any further major works. Instead, it concentrated on giving the property a new lease of life through adaptive reuse — creating a vibrant workspace for the modern workforce while retaining as much of the property’s existing heritage elements as possible.
Ang says the approach aligns with The Great Room’s overall pursuit of sustainability within the built environment. “Our last few projects have really been doubling down on this,” she adds.
For The Great Room, South Bridge, the co-working operator worked with the local design agency Kulor Group to preserve and incorporate existing fixtures and fittings into the new design, such as light fixtures and window frames. In addition, local suppliers were engaged to source materials, including furniture, tiles and fabric to minimise the space’s overall carbon footprint.
As a nod to its heritage, the location’s design incorporates various features that showcase its history, such as a gallery wall with black and white images of Chinatown in the olden days, apothecary-style decorative drawers similar to those found in traditional Chinese medicine halls, and murals of Eu Yan Sang building and the surrounding shophouses. Quirky furniture and decor pieces, such as an abacus-inspired chair and a custom chess piece board round out the stylish interior.
The gallery wall on the fourth floor displays archival images of Chinatown (Picture: Samuel Isaac Chua/The Edge Singapore)
Creating high-value workspaces
At The Great Room’s five other locations in Singapore — Raffles Arcade, One George Street, Centennial Tower, Ngee Ann City and Afro-Asia — the first impressions of visitors tend to be of its drawing room: A large, welcoming communal space at the main entrance which is usually filled with couches, cosy nooks, a coffee bar and decorative pieces.
For the South Bridge location, given the floorplate constraints, Ang and her team had to be more creative. “We had to arrange the different functions vertically, rather than horizontally,” she remarks. The location’s various spaces are spread across four levels. The first and fourth floors house communal and shared facilities. For example, the reception area and a shared work hall can be found on the first floor, while the fourth floor houses a restaurant bar, an outdoor rooftop seating area, and a meeting room. Meanwhile, the second and third floors feature dedicated offices and meeting spaces, including a boardroom-style meeting room for 12 people.
There are a total of 11 offices that can accommodate between five to 70 members. The space, says Ang, is already fully taken up. “We opened [last month] with about 80% occupancy, the highest we’ve had for a new location,” she says. “Now in our second month, we’re pretty much full. It’s a great opening for us.”
Ang believes the strong response is a testament to The Great Room’s understanding of what today’s workforce is looking for. “Our thesis has always been to build efficient workspaces, but we’re also trying to double down on high-value workspaces,” she says, with the latter referring to conducive spaces that allow for collaboration and meaningful interactions. The need for such spaces has accelerated with the onset of the pandemic. “Today, when people come into the office, they’re expecting their time spent in the office to be far more impactful, whether it is going for meetings or building social capital or other goals they cannot achieve working at home,” she explains.
Understanding this, The Great Room, South Bridge was outfitted with a higher proportion of meeting rooms compared to the other locations. In addition, it is the first location to have a full-fledged restaurant and bar that’s open to members and guests. Serving as a cafe in the day, the eatery turns into a bar in the evenings, with the alfresco seating area offering a sweeping view of the shophouses in Chinatown and the green treetops of Pearls Hill city park.
Delivering best-in-class asset management
Ang describes the business model of The Great Room as akin to asset and capital managers. “We believe that if we design and manage an asset well, we are more likely to attract the kind of partners that help propel our future growth. For The Great Room, good design means incorporating cutting-edge hospitality service, sustainability, and anticipating the evolving needs of the workplace,” she says.
She adds that the company’s track record is backed by strong financial performance across its real estate portfolio in the region. “Ultimately, we must deliver the best in class. And we like to think we can consistently deliver best in-class performance in this market”.
This has been reflected in the co-working operator’s consistently high occupancy levels across its portfolio. For example, its properties in Singapore garner an overall occupancy level of more than 90%. In addition, the company has also showcased its ability to operate and manage different types of real estate assets, from hotels, retail locations, traditional office spaces, and heritage assets.
“Our experience in Singapore has shown that the partnership model, whether it is a management contract or revenue share, would be something we are extremely focused to base our growth,” she says, adding: “We are focused on managing the asset and delivering the returns that asset owners are looking for”.
The launch of The Great Room South Bridge is the second of four announced new launches by the co-working operator. In November last year, the company unveiled its new 21,000 sq ft flagship location in Hong Kong, on the 45th floor of Cheung Kong Center. This is its second premium co-working space in Hong Kong after One Taikoo Place.
Later this year, The Great Room is set to open a co-working space in Bangkok in the new Park Silom mixed-use development, which is set for completion this June. The new co-working space will be the company’s second presence in Bangkok after its 30,000 sq ft co-working space on the 25th and 26th floors of Gaysorn Tower.
Subsequently, The Great Room is expected to enter the Australian market later this year with an as-yet-unannounced co-working location in Sydney, New South Wales.
Acquisitions and Asia Pacific expansions
The strong fundamentals of the company have already caught the eye of US flexible workspace provider, Industrious. The New York-headquartered firm announced its acquisition of The Great Room in May last year. At the same time, it also acquired European co-working player Welkin & Meraki.
According to news reports at the time, Industrious paid approximately US$100 million ($133 million) in cash and stock for its acquisition of the two companies. Global real estate consultancy CBRE holds a 40% stake in Industrious when it made a US$200 million investment in the firm in February 2021.
Ang says its acquisition by Industrious directly benefits The Great Rooms’ position in the global market, strengthening its way forward in terms of new location deals and a global membership network. “Industrious has a proven track record of doing partnership models in the US and about 70% of their portfolio is based on partnership models. As a result, we have been able to learn from their experience but also bank on their US relationships and turning them into potential global partners.”
She adds this has also opened the doors for The Great Room to engage in discussions with global institutional real estate funds and landlords based in the Asia Pacific region.
In addition, with CBRE as a major stakeholder in Industrious, The Great Room has been able to lean into the consultancy’s vast leasing and marketing network in the region. “It means having a great marketing presence and contact with global customers to help us reach out to customers in different locations. So, the synergies there are immediate and obvious,” says Ang.
Ang: We are going to double down on our existing markets like Bangkok and Hong Kong, while eyeing new market entries like Sydney and Shanghai (Picture: Samuel Isaac Chua/The Edge Singapore)
She shares that when news of the acquisition partnership was released last year, existing members of The Great Room were excited to learn that they would have access to Industrious as well as Welkin & Meraki locations in the US and around the world. This expands the global network to 180 locations and is a part of their existing membership, says Ang.
Looking ahead, Ang says that this sets up The Great Room in a stronger position in terms of organic expansion and potential acquisitions of its own in the future. “In terms of organic expansion, we always see (our portfolio) as a string of pearls. Each location needs to have a standalone great performance but also add to the portfolio,” she says.
“We are going to double down on our existing markets like Bangkok and Hong Kong because we strongly believe in those markets. But we are also eyeing new market entries like Sydney,” says Ang. She adds that other new market firsts include Melbourne, Tokyo, and Shanghai.
Ang says that a possible way to propel their future growth might be through acquisitions and mergers. “We would be on the lookout for acquisitions and takeovers where it makes sense for us”.
However, given the relatively fragmented nature of the co-working and flexible workplace industry in the region. It is challenging to find a suitable player with the right assets, product fit, financial performance, and expectation of valuation of the portfolio to go ahead with a takeover, she says.
Overall, Ang says that her forward-looking sentiment for the co-working and flexible workplace industry in the region is “quite bullish”, but she is also mindful of global headwinds such as macroeconomic volatility and relatively high interest rates.
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